A System of Production in Which Each of a Product's

question 165

Multiple Choice

A system of production in which each of a product's components is produced in the location where the cost of producing that component is lowest is called ________ production.

• A) rationalized
• B) greenfield
• C) centralized
• D) maquiladora

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Definitions:

Compensating Differentials

Wage differentials that compensate workers for the job attributes, such as difficulty level or undesirable conditions, indicating the premium required to attract workers to these positions.

Marginal Productivity Theory

A principle that describes how the addition of a unit of labor or capital increases output, holding other factors constant.

Unequal Distribution

A situation where resources, wealth, or opportunities are not evenly shared among members of a society.

Median Earnings

The midpoint of income distribution, meaning that half of the workers earn more than this amount and half earn less.